Confused about Retirement Savings? 7 Popular Pension Myths Busted!

With the next phase of automatic enrolment starting from April, Alistair McQueen from Aviva separates facts from fiction.

The minimum amounts that can be put into workplace pensions will be stepped up from April, as UK savers are encouraged to put aside more for their retirement.

Under automatic enrolment rules, from April 6, the minimum that can be put in by employers and their staff will increase from 5% of qualifying earnings to 8%. Within the new 8% rate, at least 3% must be paid by the employer, with the remaining 5% made up by staff.

Automatic enrolment started in autumn 2012, amid concerns people were living for longer but not saving enough for their later years. “Automatic enrolment is approaching its seventh birthday. In its short life, it has already brought a quiet revolution to pensions in the UK,” says Alistair McQueen, head of savings and retirement at Aviva.

Pensions are not always easy to understand, though, and there’s still a lot of confusion around them for lots of people. Do you feel unsure of the facts? Here, McQueen busts seven pensions myths…

busting pension myths

Myth 1: No one is saving into a pension

Automatic enrolment has introduced more than 10 million new savers to workplace pensions since 2012. There are now a total of 22 million people participating in workplace pensions in the UK.

Myth 2: Pensions are for old people

Contrary to popular perception, it is the under-30s who are leading the way. All ages have seen an increase in workplace pension participation since 2012, but the under-30s have seen the biggest increase – more than doubling from 35% saving to over 79% by 2018.

busting pension myths

Myth 3: The government will pay for all my retirement

It’s true that we can expect some money in retirement from the state, but this is currently up to a maximum of about £8,500 every year. Today, the majority of the typical retirees’ income in retirement is from sources beyond the state, such as private pensions and other savings.

Myth 4: I will receive my state pension from age 60 if I’m a woman, or 65 if I’m a man

These commonly referred to and long-standing ages were set decades ago, when we could generally expect a few short years in retirement. Since then, average life expectancy has greatly increased, and the age at which we are eligible for our state pension has been increasing, with women starting to qualify for their state pension at the same age as men.

The state pension age is set to keep rising too. The yourpension.gov.uk website can help you check your state pension age.

busting pension myths

Myth 5: I can’t retire until I reach my state pension age

We are free to retire whenever we want to. However, we can only really think about retiring when we feel we have saved enough money to meet our needs when we’re not working. New rules allow people to access private pensions from age 55 – but the state pension age is set by government.

As individuals, we have the freedom to choose our retirement age, but this brings with it a responsibility to ensure we can fund our lifestyle from that point onward. There are many free online resources to help make this decision – such as Aviva’s ‘My retirement planner’ (aviva.co.uk/retirement/tools/my-retirement-planner).

Myth 6: I’m the only one who is confused by pensions

Research suggests only a minority of us feel we really understand pensions. So, if you’re feeling a bit uncertain, you’re not alone. The great news is that more of us are saving for our future. And if you’re looking for a little nudge in the right direction, Aviva suggests three general rules of thumb that could help you be better prepared:

1. Save at least 12.5% of earnings towards your retirement. This can include money from your employer and the taxman.

2. If possible, start saving at least 40 years before your target retirement age.

3. Try to have built up at least 10 times your salary in your pension by the time you retire.

busting pension myths

Myth 7: Retirement is further away than ever

There’s still a collapse in workplace participation as we progress through our 50s. This represents a huge waste of talent, experience and potential. One of the strongest levers we can pull to help fund our lives in retirement is to work longer. Many employers are taking fresh steps to support a fuller working life, with the aim of ensuring that age is no barrier to opportunity.

Contemporary Connections Exhibition In London this March

Art Noble Exhibition March 2019

CONTEMPORARY CONNECTIONS
Curated by ArtNoble
Tuesday 19 – Saturday 30 March 2019

Following on from 2018’s debut exhibition in November, ArtNoble is proud to present Contemporary Connections, a group exhibition displaying works by seven contemporary European artists.

In a world constantly heading towards self-absorption, Contemporary Connections aims to initiate a dialogue among artists, artwork, audience and collectors, creating enduring connections that are fundamental to our happiness, existence and wellbeing. Whilst not being tied down to a specific thematic or style, Contemporary Connections will display a distinct selection of works, ranging from ceramics, to photographs and paintings, including the feature image above by Yaprak Akinci – Keep your barrels safe.

Art Noble Exhibition March 2019
Alberto Selvestrel - Senza Titolo

These works have been chosen to stimulate interactions between the works and artists, with the aim that these interactions will propagate also to the collectors and visitors.
To enhance this theme of connectivity, talks, workshops and presentations by the artists will be held at the gallery to complement the exhibition. Details of these will be announced on our website.

Art Noble Exhibition March 2019
Gaila Adair - Piccadilly Hill
Art Noble Exhibition March 2019
Pierantonio Maria Micciarelli - Verso il Tibet

ArtNoble’s exhibition ‘Contemporary Connections’ opened on 19th March and will be on show until Saturday 30th March at Willesden Gallery (95 High Road, London, NW10 2SF).

On weekdays we will be open from 9am until 8pm whilst at weekends we will be open from 10am until 5pm.

Come by, say hi and enjoy the beautiful works on display by our artists.

You can find a selection of photos from the exhibition and follow this link to access the online catalogue.

ArtNoble is a distinctive exhibition platform dedicated to the promotion of unique contemporary talents. Founded by Matthew Noble in the summer of 2018, ArtNoble aims to provide an alternative to the standard art gallery model by sourcing talented and upcoming artists irrelevant of their background and medium and curating site-specific exhibitions, with the ultimate vision of connecting the artists and their works to an ever-growing number of collectors.

Artists

Gaila Adair
Yaprak Akinci
Cinzia Castellano
Alberto Fusco
David Gee
Pierantonio Maria Micciarelli
Alberto Selvestrel

Art Noble Exhibition March 2019
Alberto Fusco - Aura
Art Noble Exhibition March 2019
David Gee -Reptilian Bow

More about ArtNoble

ArtNoble is a distinctive exhibition platform dedicated to the promotion of unique contemporary talents. Founded by Matthew Noble in the summer of 2018, ArtNoble aims to provide an alternative to the standard art gallery model by constantly sourcing talented and upcoming artists, irrelevant of their background and medium, and curating site-specific exhibitions.

ArtNoble’s mission is to overcome the barriers and exclusivity typically associated with today’s art world, with the ultimate vision of connecting artists and their works to an ever-growing number of collectors, art enthusiasts and interior designers.

Operating in this way allows ArtNoble to make contemporary art accessible to everyone, creating mass engagement with several different artworks, increasing the perspective with which art is perceived, engaged with, and ultimately, acquired.

Currently operating in London and Milan, ArtNoble represents several contemporary artists. Further to artist representation, ArtNoble also works closely with a number of interior designers, procuring art for their client’s homes, along with acting as an advisor to a number of private collections.

Web site artnoble.co.uk

Art Noble Exhibition March 2019

8 Tips for Successfully Managing your Money as a Couple

Finances can play a big part in relationships. Vicky Shaw finds out how to set good strategies in place and avoid money fall-outs. So, love has blossomed and you think you've found the perfect partner - but are you financially compatible? Understanding each other on money issues can go a long way to making or breaking a relationship.

managing money in a relationship

“Whether you’re married, living together or just getting to know one another, it’s crucial both parties understand each other’s finances and know how they view money management,” says Emma-Lou Montgomery, associate director at Fidelity International (fidelity.co.uk).

“Being open to discussing the long-term financial plans you may have, and vice versa, can save having a lot of issues further down the line.”

Here, Montgomery shares eight tips for making sure your finances flourish in your relationship…

2019 money financial predictions

1. Don’t be afraid if one of you is a saver and the other is a spender

In a balanced relationship, having one keen saver and one more comfortable spending (within reason) can be beneficial – if it’s clear who’s responsible for what financially in the relationship. The saver can encourage a healthy attitude towards financial saving goals – be it a first home, an adventure holiday, or just cash for a rainy day. On the other hand, the spender may take on monthly living costs and cover expenses like socialising with friends and family.

2. Don’t leave your partner in the dark

All too often, couples leave one of the parties completely in the dark over bigger commitments, like savings or retirement plans, leading to misunderstandings and tension.

The money and your financial security belong to both of you, so make sure you both have at least a basic understanding of the state of your finances. It may feel daunting at first, but talking openly about your finances is so important, both when fostering new relationships or maturing in a long-term relationship or marriage.

managing money in a relationship

3. Be honest

Many people hide debts from their partner – often out of embarrassment. But honesty really is the best policy. If you’ve come to the point when securing a joint loan or mortgage makes sense, it’s crucial any unpaid debt or blips on credit scores come to light. A supportive partner will work with you to find a solution. If they’re not up to it, then better you know now rather than later.

4. Communicate when one of you earns more than the other

Pretending you earn more than you do when you first meet might seem like a good idea, but eventually the shortfall will become apparent. Communication here is key. Some couples have separate bank accounts, others keep a joint account for household expenses, some agree to split bills equally, some do it in proportion to their income, while others divide up the outgoings, with one person paying the mortgage/rent and another responsible for utility bills, for example.

managing money in a relationship

5. Don’t let ‘outside’ interests/expenses become a source of conflict

It may be that you have children from a previous relationship who need your financial support, or a hobby that requires a substantial financial outlay. If you aren’t open about the costs with your partner, these ‘outside’ expenses can become a source of conflict. Be up-front and honest, so you both can ensure you’re able to factor them in to your shared budgeting.

Often, keeping a separate pot of money or a separate account for these expenses is a good way to ensure they’re accounted for and covered. Separating them out also means they’re not a constant niggle to your partner. Setting up a direct debit to cover these costs is another way to make it easier.

6. Discuss the future now

For example, if you both want to travel the world later in life, factor that into your finances now to make sure that when you do travel, you can travel in style.

managing money in a relationship

7. Don’t be afraid to take control

While it’s good to plan together, make sure you also take responsibility for your own finances – whether it’s by opening a new savings account or contributing more into a pension.

8. Protect yourself and your partner

Nowadays, many people choose to live together for longer before getting married or without tying the knot at all. However, this can be an issue in terms of your finances. You could consider setting up an agreement to ensure that both parties are protected and assets are divided as you would wish.

Hoping to get on the property ladder soon? 8 tips for First Time Buyers

It's a huge, expensive step but can be done - so soak up these expert tips, says Vicky Shaw. This year could be a bit uncertain for the housing market, which may be making first-time buyers feel somewhat nervous. However, some recent figures may offer some reassurance for those trying to make the jump onto the property ladder.

Research from Yorkshire Building Society suggests the number of first-time buyers getting on the property ladder with a mortgage in the last year, was at its highest level since 2006. Across the UK, 367,038 first-time buyers secured mortgages in 2018, up from 362,800 in 2017, the analysis suggests.

There are also some steps first-time buyers could take, which may boost their chances of bagging a property. “Buying a first home can be as daunting as it is exciting, but there are a number of simple steps people can take to prepare themselves and make the process as smooth as possible,” says Chrysanthy Pispinis of Post Office Money.

Here are Post Office Money’s eight top tips for getting on the property ladder…

first time buyer top 8 tips

1. Set a savings goal

Three-quarters (75%) say that saving for a deposit is the biggest hurdle to home ownership, with first-time buyers spending four years adjusting their lifestyle to save for their starter home, according to a survey of people who recently got on the property ladder. So setting a savings target early is important to keeping you focused and on track.

2. Factor in the additional costs of moving

Aspiring homeowners must not forget additional costs associated with buying a home, such as removal firms, estate agent fees and surveyors. It’s important to consider these costs in advance and save little and often.

first time buyer top 8 tips

3. Take time to talk

Parents – as the ‘bank of mum and dad’ – are playing an increasingly important role helping many first-time buyers onto the property ladder, loaning on average £24,347, according to Post Office Money. But of the one in six first-time buyers funding their home purchase from a parental loan, 87% have no proper agreement in place, its research also found.

Therefore, it’s important everyone involved is clear about the nature of their agreement, so that everyone’s expectations are aligned. This includes making it clear whether the money is a gift or a loan that needs to be paid back. Post Office Money has a ‘bank of mum and dad conversation guide’, which could help with such conversations. (postoffice.co.uk/dam/jcr:93ea6a47-6444-4ac8-8a22-c091054a3541/Mortgages-Advice-Doc.pdf)

4. Calculate how much you can afford to borrow

Once your savings pot is up and running, consider using an online affordability calculator to get an idea of how much you’ll be able to borrow based on your income and outgoings. Although this should be used as a guide, the information will help you focus on properties that are within your price range.

first time buyer top 8 tips

5. Know the (credit) score

Before getting a mortgage, you will be credit checked, so now’s the time to check your own credit report and ensure all the information it contains is accurate and up-to-date. A good credit score can be the deciding factor in not only getting approved for a mortgage, but also the rate you are offered. Plan now to start paying down any outstanding debt, be sure not to miss any agreed payments on utility bills or mobile phone bills, and try to make more than the minimum repayment in the six months before your mortgage application.

6. Find the right mortgage for you

There are lots of mortgages out there aimed specifically at first-time buyers, including some very innovative deals.

first time buyer top 8 tips

7. Research affordability hotspots

You may have your heart set on a popular area – but so will many other buyers.

On average, new buyers will end up moving 5.2 miles away from where they originally intended. Consider widening the net to make your budget go further, so you can buy more bricks and mortar for your money. You could try searching in up-and-coming areas, which may become future property hotspots, rather than places where property prices have already increased by a lot.

8. Know the local rate of sale

On average, it takes 102 days for a property to sell in the UK. Understanding the rate at which property sells in the area you’re looking to buy in can potentially help when making buying decisions.

If you are starting your home buying journey and would like local, financial or property advice please pop in to your closest office for a cup of tea and a chat with our team, they will be delighted to give you all the help you need.
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8 Key Money Moments to be Prepared for in 2019

It pays to be prepared - or at least means you'll be a little more in control of your money. Vicky Shaw reports on this year's financial forecast.

2019 money financial predictions

As with any year, 2019 is bound to bring some unexpected surprises. But, looking ahead, there are some money moments you may be able to prepare for – even if some are more certain than others.

“Uncertainty and change are a part of life, and we’ll be better placed to ride these waves if we’re prepared for whatever may come next,” says Alistair McQueen, head of savings and retirement at Aviva. “We will all benefit from a couple of hours to prepare our finances for whatever 2019 may bring.”

So what can you do to help get prepared? Here, McQueen highlights some of the key 2019 money moments to get ready for…

2019 money financial predictions

1. Get ready for the rising state pension age

In 2018, the state pension age for men and women was equalised, at 65. Men and women will now experience a state pension age rising in tandem. The state pension continues to represent most peoples’ biggest source of income in retirement. So, in 2019, it could be a good idea to request a free state pension forecast from the government to understand when you will be entitled to yours, and how much you may receive (gov.uk/check-state-pension).

2. Get ready for a longer working life

Last year saw the number of people in work over the age of 50 reach a record 10 million. As our life expectancy rises, we can expect this trend to continue. Aviva expects one in three workers in the UK will be over the age of 50 in the next decade. So, looking ahead, it may be worth starting to re-frame your expectations towards a longer working life. Aviva is launching a new service called the ‘mid-life-MOT’, to help our people prepare for this longer working life.

2019 money financial predictions

3. Get ready for an increase in pension payments

Employers have duties to provide a workplace pension. Since 2012, this new system – called automatic enrolment – has introduced nearly 10 million new savers across the UK to pensions. It’s been a great success. In April 2019, the minimum pension payment will increase from 5% of your earnings to 8% of your earnings. At least 3% of this 8% must come from your employer. A workplace pension can be a valuable way of saving for later life. So, in 2019 think about preparing for this increase in payments. For your future, it will pay to save.

4. Get ready for potential further interest rate increases

After a near decade of record low interest rates, 2018 saw the Bank of England increase its base rate to 0.75%. Many commentators expect 2019 could see further small increases in the base rate, in a bid to ease rising price pressures. This would be good news for savers, but not so good for the millions of borrowers holding short-term loans and mortgages. So, in 2019, it would be a good idea to shop around for the best saving and borrowing rates. A small change could make a big difference.

2019 money financial predictions

5. Get ready for more people taking up pension freedoms

The new pension freedoms for over-55s have proven to be hugely popular. More than £20 billion has been withdrawn from private pensions in new flexible payments. If you’re over 50 and considering your options, it would be a good idea to consult the government’s free Pension Wise service for guidance (pensionwise.gov.uk).

6. Get ready for more ways to manage your money online

Many of us regularly go online to send emails, do a spot of shopping or catch up on social media. But using the internet to manage pensions and investments continues to be an afterthought for many. Most pension and investment providers now offer free online services to help you manage your money. So, in 2019, consider taking advantage of these services so you can make the most of your money, whenever and wherever you want.

2019 money financial predictions

7. Get ready for the new face of the Bank of England £50 note

The new face on this new note will be announced in summer 2019 – and the Bank has stated that it will be someone who has contributed to science.

8. Get ready for the long game

2019 looks set to be a time of volatility and change. At times like these, it is helpful to remember that investments are typically designed to navigate at least a five-year horizon, or even up to 40 years if it’s our investment in our retirement. So, in 2019 it would be a good idea to remember those longer-term goals.

2019 money financial predictions